The yield spreads on corporate debt relative to government debt around the world have been narrowing mostly over the past two years. Several factors have driven the narrowing in corporate debt yield spreads. Global economic growth has run above long-term trend since early 2002 and the income from strong growth has been shared more strongly to company profits through the period rather than to wage and salary earners. The net result has been a long period of very strong improvement in company profits around the world which has allowed companies to strengthen their balance sheets. The strong rise in profits (US S&P 500 companies, for example, have increased operating ea...